South Korean semiconductor giant SK Hynix announced on Wednesday that it will buy back and cancel 24.9 billion euros worth of its own shares.
The 40,000 billion won plan marks the largest share repurchase programme ever launched by a publicly listed company in South Korea.
The company said its board of directors had approved the repurchase scheme as executives sought to improve returns for shareholders following a sharp fall in the firm's share price.
In a regulatory filing, the group stated that it had decided to acquire and cancel 40,000 billion won of treasury shares in order to carry out an efficient reallocation of capital and increase shareholder value. The chipmaker added that it viewed its stock as undervalued compared with its intrinsic value and business fundamentals.
Scale of the share buyback
The 24.9 billion euro transaction represents an extraordinary sum on global equity markets. The planned buyback is equivalent to nearly three times the entire stock market capitalisation of French carmaker Renault, which stands at 8.55 billion euros. Renault, based in Boulogne-Billancourt, France, is one of Europe's long-established automotive manufacturers, underscoring the massive capital scale of modern semiconductor leaders.
A share repurchase programme involves a company buying its own stock back from public investors. When a business cancels those repurchased shares rather than holding them in treasury, the total number of shares in circulation permanently falls. That reduction concentrates equity ownership, lifting earnings per share and bolstering key financial returns for remaining investors.
Headquartered in Icheon, South Korea, SK Hynix is the world's second-largest manufacturer of memory semiconductors. The company produces dynamic random-access memory, known as DRAM, as well as NAND flash memory chips. These electronic components provide essential data storage and working memory for personal computers, mobile smartphones, and enterprise data centres across the globe.
Stock market volatility in Seoul
The buyback announcement follows a period of intense turbulence on the Seoul stock exchange. Shares in SK Hynix fell by 9.75 per cent on Wednesday to close at 1.5 million won, marking a steep drop from an all-time peak of nearly three million won reached in June.
Despite the recent retreat, the company's shares remain up 130 per cent since the start of 2026 and have surged 487 per cent over the past twelve months. That extended rally had previously propelled South Korea's benchmark Kospi index past the 9,000-point threshold in mid-June. However, the index subsequently tumbled below 5,500 points just five weeks later, before stabilizing around 6,500 points.
Record profits at both SK Hynix and its domestic competitor Samsung Electronics had fueled widespread optimism about South Korea's economic trajectory earlier this year. Both manufacturers supply critical memory chips required for artificial intelligence applications. Samsung Electronics, based in Suwon, is South Korea's largest corporation and the world's leading memory producer.
The board's decision also follows share purchases by top corporate leadership. In late July, SK Group chairman Chey Tae-won bought approximately 4.8 billion won of SK Hynix shares on the open market, a purchase seen by investors as an effort to demonstrate confidence in the business while technology valuations were sliding. SK Group is South Korea's second-largest conglomerate, spanning energy, telecommunications, and advanced electronics.
Surging demand for artificial intelligence chips
The recent market volatility contrasts with rapid operational growth driven by the expansion of artificial intelligence. Last month, SK Hynix reported that its second-quarter net profit jumped by 1,242 per cent compared with the same period a year earlier, powered by intense global demand for its advanced semiconductor hardware.
Modern artificial intelligence processors require High Bandwidth Memory, or HBM, which stacks dynamic random-access memory chips vertically to transfer data at high speeds. SK Hynix has established itself as an essential manufacturer of this specialised silicon, supplying leading international technology firms.
Also last month, the company announced a planned five-year agreement to supply 750 billion dollars worth of memory chips to global technology leaders, including American artificial intelligence chipmaker Nvidia, which designs graphics processors that power large language models.
SK Hynix indicated that further capital distributions could follow. The company stated that it will continue to consider additional share repurchases and cancellations in the future, taking into account its cash reserves, prevailing market conditions, and distributable profits.
